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🐂 SMIC — Company Profile (Educational)

Educational site, not investment advice. Market cap / stock price / quarterly numbers change quickly, so we don't write them. Use official filings + Yahoo Finance links below to check current data.

⚠️ Ticker note: SMIC is not U.S.-listed. Primary listings: SSE STAR Market (688981.SS) + HKEX (0981.HK); the U.S. OTC pink-sheet equivalent has minimal liquidity. The U.S. added SMIC to its Entity List in 2020/12.

📌 Basic Info

Field Value Source
Primary business China's largest foundry — 14nm-180nm primary; "7nm-like" nodes via DUV multi-patterning (no EUV due to export controls); 1-2 generations behind TSM wiki / HKEX + SSE filings
Founded / HQ 2000 / Shanghai, China wiki
CEO / Co-CEOs Zhao Haijun + Liang Mong Song (dual-CEO structure) company announcement
Primary listing SSE STAR Market: 688981.SS (primary) + HKEX: 0981.HK —
U.S. regulatory Entity List (since 2020/12) + U.S. export controls → cannot procure < 14nm equipment U.S. BIS announcement 2020/12
Fiscal year Calendar year (Jan 1 - Dec 31) HKEX + SSE quarterly + annual reports

💡 Real-time market cap / share price / per-node mix / China customer exposure: see public filings below

🏭 Industry Chain Coordinates (Part 1-C6 framework)

Upstream (Who SMIC depends on)

Supplier What flows Key dependency
ASML (DUV only, cannot buy EUV) Lithography equipment (restricted by 2023 + 2024 export controls) core bottleneck — origin of TSM generation gap
AMAT / KLAC / LRCX (U.S.-restricted in part) Semiconductor equipment (same as ASML; partial node restrictions) tied to fab node ramp
Chinese domestic SMEE Shanghai Micro Electronics Domestic DUV (90nm in volume production) long-term domestic substitution dependency

Downstream (Who depends on SMIC)

Customer What flows Concentration
HUAWEI HiSilicon Kirin / Ascend series (after Huawei Entity List, TSM stopped supply; SMIC took over) core strategic customer — Ascend 910/910C AI chips
Chinese fabless (ZTE / Tsinghua Unigroup / YMTC + CXMT) Various domestic SoC + memory controllers Chinese domestic strategic chain
Chinese auto + industrial + IoT Auto-grade + industrial chips long-tail
U.S. customers (historical; now significantly reduced) Some mature nodes now very small, tied to export controls

Competitors

  • Chinese domestic: Hua Hong Semiconductor (1347.HK, mature-node duopoly) · YMTC / CXMT (memory foundry)
  • Global leading-edge (large gap): TSM · Samsung Foundry (SSNLF) · INTC IFS
  • Global mature node: UMC (UMC) · GFS (GFS) · Tower (TSEM)

💼 Business Model + Value Capture (Part 1-C7 lens)

  • Revenue mix: By node: 14-28nm + 7nm-like is high-margin (driven by China AI chip demand) / 40-180nm mature is long-tail; by customer: China ~80%+
  • Gross margin: Historically 20-30% (below global foundry average; yield + equipment depreciation heavy)
  • Pricing power: 7nm-like nodes have China-domestic monopoly (Ascend etc.) — strong (limited to China domestic)
  • Replacement difficulty: China-domestic strong political + strategic customer binding; but SMIC cannot access global leading-edge market

(For per-node revenue / China customer exposure, see HKEX + SSE filings)

🏰 Moat Assessment (Part 3-C2 Buffett 5-step lens)

Type Strength (0-1) Reasoning
Brand 0.4 Strategically important in China semiconductors, but large gap to TSM
Switching cost 0.5 China-domestic customers have no substitute (strategic + domestic policy); but SMIC cannot access global leading-edge
Network effect 0.3 China IC ecosystem coordination
Scale + cost 0.5 China's largest foundry, but equipment export controls = technology ceiling

Total: 1.7 / 4 → medium moat (China-domestic strategically important, but export controls + yield are structural bottlenecks)

⚠️ Key Invalidation Triggers (Part 3-C5 anti-thesis lens)

Monitor; if triggered, re-evaluate thesis:

  • Trigger 1 (event): U.S. further expands export controls → SMIC cannot ramp 5nm-like nodes
  • Trigger 2 (medium probability): TSM finds compliance-allowed paths to serve Chinese customers (Hygon / Zhaoxin) → some high-end orders flow back to TSM
  • Trigger 3 (quarterly): Persistent yield issues → 7nm-like node shipments limited
  • Trigger 4 (low probability): China government subsidy policy reversal (history shows strong policy, but adjustment modes possible)
  • Trigger 5 (annual): China EUV in-house path (SMEE etc.) breakthrough → SMIC unconstrained (low probability, unlikely within 5-10 years)

📚 Public Filings (DYOR)

Live quote: Yahoo Finance 0981.HK (HK) · Yahoo Finance 688981.SS (A-shares)

Educational · Numbers change, the method does not · Make investment decisions based on your own research + risk tolerance